In Example 5 5 16, a normal approximation to the negative binomial distribution was given Just as with the normal approximation to the binomial distribution given in Example 3 3 2, the approximation might be improved with a continuity correction For XiS defined as in Example 5 5 16, let Vn n i 1 Fo...

a For the exact calculations use the fact that V n is itself distributed negative binomia ...

In Example 5.5.16, a normal approximation to the negative binomial distribution was given. Just as with the

Question:

In Example 5.5.16, a normal approximation to the negative binomial was given. Just as with the normal approximation to the binomial given in Example 3.3.2, the approximation might be improved with a "continuity correction." For XiS defined as in Example 5.5.16, let Vn = ∑n i =1. For n = 10,p = .7, and r = 2, calculate P(Vn = v) for v = 0,1,.... 10 using each of the following three methods.
(a) Exact calculations
(b) Normal approximation as given in Example 5.5.16
(c) Normal approximation with continuity correction Distribution
The word "distribution" has several meanings in the financial world, most of them pertaining to the payment of assets from a fund, account, or individual security to an investor or beneficiary. Retirement account distributions are among the most...